Levi Strauss & Co. held its ground in the first quarter, lapping very strong revenue gains from a year ago.
The bottom line, though, could not keep up.
First-quarter net income slid to $114.7 million, or 29 cents a share, from $195.8 million, or 48 cents a year earlier. However, adjusted earnings of 34 cents a share came in 2 cents better than the 32 cents analysts anticipated.
Revenues for the three months ended Feb. 26 rose 6 percent to $1.7 billion, with the increase coming from a $100 million benefit from a planning shift that moved wholesale shipments into the first quarter from the second. The direct to consumer business made up 42 percent of net revenues.
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In constant currencies, revenues gained 9 percent on top of a 26 percent gain a year earlier, when the big rush up in the consumer world was just ending with Russia’s invasion of Ukraine and worries over inflation.
The DTC channel saw a 16 boost in constant currencies as revenues in the Americas increased 7 percent, Europe inched up 2 percent and Asia gained 22 percent.
Chip Bergh, president and chief executive officer, said: “We delivered strong growth in our international business and record-breaking revenue performance in our direct-to-consumer channel. As we celebrate the 150th anniversary of the iconic 501 jean, we are deepening connections with consumers and cementing loyalty with the next generation of Levi’s fans. This past quarter in the U.S., we were the market share leader among the key 18- to 30-year-old consumer, and we continued to grow share in our women’s denim bottoms business, further narrowing the gap to number one.”
Levi’s paid out about $48 million in dividends during the quarter.
Still, investors are a very much what have you done for me lately crowd and shares of Levi’s slipped 4.9 percent to $17.15 in premarket trading on Thursday.
